Microsoftie's tell-all on 'rival-flinging' Ballmer: The politics of disbelief

Analysis A former Microsoft executive has sketched an unflattering portrait of Steve Ballmer that depicts him as a cut-throat Machiavellian schemer, and claimed in his new book that the top man at Redmond has forced out rivals who challenged his authority.

Joachim Kempin, a former head of Microsoft's OEM business, claims chief executive Ballmer squeezed out those who possessed the potential to challenge his position as Microsoft’s top dog.

In an interview with Reuters, Kempin said he first noticed Ballmer’s exec-disposal technique after Rick Belluzzo exited the business in 2002, after just four years at Microsoft. No other examples are cited.

Belluzzo was a former executive vice president of Hewlett-Packard. Immediately before joining Microsoft as vice president of the consumer business, he was CEO of Unix server Silicon Graphics.

The consumer biz exec is credited by Microsoft's official history as having led the team that turned MSN into the "most visited website" on the internet and helped establish the Xbox. There's also a bit of garnish about the .NET "division". The Reg is suspicious of the last two claims - it's James Allard and Bill Gates and chief technical strategy officer Eric Rudder who were responsible for the Xbox and .NET.

Belluzzo quickly ascended Redmond’s corporate ladder and was named president and chief operating officer in 2001. Then, suddenly, Belluzzo was gone, announcing he was stepping down in 2002.

Kempin tells Reuters: "He (Belluzzo) had no room to breathe on the top. When you work that directly with Ballmer and Ballmer believes 'maybe this guy could someday take over from me', my God, you will have less air to breathe, that's what it comes down to."

Belluzzo's rise coincided with Ballmer's assumption of the CEO’s role in 2000, with the changes supposed to represent the growing up of Microsoft.

In the Reuters' piece, Kempin also proceeds to lay the now familiar missed opportunities at Ballmer’s feet – the tablet and smartphone were all apparently on the horizon, even when Kempin was with the company in the early 2000s.

“They missed all the opportunities they were talking about when I was still in the company. Tablets, phones ... we had a tablet going, we had tablet software when Windows XP came out, it was never followed up properly," Kempin said.

According to Kempin, Ballmer is better suited to operations than the CEO’s post.

“Steve is a very good business guy, but make him a chief operating officer, not a CEO, and your business is going to go gangbusters," said Kempin. "I respect that guy (Ballmer), but there are some limitations in what he can and can't do and maybe he hasn't realized them himself."

The Reg contacted Microsoft for comment, but a spokesperson said there was no statement at the time of writing.

Kempin was in charge of Microsoft’s Windows OEM business between 1987 and 2002 and he left in the period after Microsoft was judged by a US court to have abused its relationship with PC makers. In its antitrust case with the US government, Microsoft was accused of strong-arming PC makers into shipping Internet Explorer with PCs at the risk of losing Windows to snuff out competition from Netscape. Machiavellian, indeed...

The tribe has spoken....

Should we be be alarmed or surprised by Kempin's claims? Ballmer wouldn't be the first corporate executive to have eliminated the competition.

Business is a jungle and nowhere is it as bloody as American corporate culture. Having spent 10 years covering tech in Silicon Valley, this correspondent was amazed at the levels to which this competition was taken.

It is a routine for senior execs to pack out the echelons with supporters, regardless of talent and drafted in from their previous employers. Senior management make work so unpleasant for those not on their side that the hapless are eventually broken and forced to leave. Colleagues plotted against colleagues for advancement regardless of actual job talent.

As for intrigue at the top: SAP and Oracle have seen talent tipped for the top suddenly and inexplicably gone. Some were just in the wrong place at the wrong time, over-promoted and overpaid with no place to go.

Who left and why...

The Reuters piece paints a picture of Ballmer by association. It lists prominent Microsoft executives who’ve recently left recently, implying a connection - that they, too, were eased out through some Balmeresque machinations. But it is difficult to see how this is more than random association.

Reuters lists Steven Sinofsky, who left abruptly in November 2012 on the heels of the launch of Windows 8; chief software architect Ray Ozzie, who was with Microsoft from 2006 to 2010; and former Office and business software chief Stephen Elop, who left for Nokia in 2010 after just a year with Microsoft. It’s possible Elop was already champing at the bit, given his rapid moves – COO of Juniper, head of Microsoft’s Business Division, Nokia CEO all within a two-year period.

The reasons for Sinofsky’s exit are not clear, but sales of Windows 8 have not gone as hoped by the company – or, likely, Sinofsky - while Sinofsky has gone so far as to speak out to deny he left because he wanted to consolidate his own power inside Microsoft.

Ozzie, supposedly Microsoft’s replacement for vision chief Bill Gates, helped lead Microsoft’s cloud Windows Azure but he never really established a firm role or power base inside the company. Meanwhile, Elop’s tenure as the chief of the business unit was marked by a period of flatish growth, with Sinofsky – then working on Office – smoothly leading development.

Even the Belluzzo case isn't clear-cut. A 47-year-old Unix server guy from Silicon Valley joins an aggressive, Unix-bashing start-up outside the The Valley? It was always a curious hire. A big-systems guy inexplicably handed the job of leading a consumer and web business. It's difficult to see how Belluzzo had any future inside Microsoft. It seemed to this correspondent at the time that he'd been promoted up and out of what was belatedly recognised as an opportunity not to be left in the hands of a Belluzzo.

More hardball, not less, was needed

Microsoft is noted for its Darwinistic culture of survival, where business heads must slug it out. Also, it's a constant source of debate how the culture inside Microsoft doesn't suit "outsiders": Belluzzo, Ozzie and Elop all took senior positions having been drafted in.

For all that, Ballmer has developed a playbook for coping with the loss of group presidents and it's a model that's helped consolidate his position. He has broken up the president’s role, splitting out responsibilities and spreading them among others lower down the chain with a technology background and who report directly to him. This has left him in with huge oversight over Windows, Office, business apps, Xbox and phones. Just Server and Tools and Internet remain relatively independent thanks to their group presidents pre-dating recent changes.

Ballmer is wide open, but not for being a corporate Machiavelli playing hardball corporate politics, as Kempin maintains in his book.

Microsoft's chief is vulnerable on quite a few subjects, though: tablets, smartphones, search, the $6.2bn aQuantive write-down, paying top dollar for Skype in a war where Microsoft was the only bidder, and for permitting a senior executive - Sinofsky - to run out of control on a new product and then to let him slip away.

Shareholders will forgive the excessive management styles of their CEOs, if that style helps the bottom line or stock price. Any politicking by Ballmer hasn't advanced Microsoft and, instead, the company has spent 12 years throwing billions of dollars at every game-changing technology wave to catch up. The only thing remarkable about Kempin's story is Microsoft's shareholders haven't been less forgiving of their leader. ®